C.R. No. 443 of 2008 [1]

IN THE HIGH COURT OF PUNJAB AND HARYANA AT

CHANDIGARH.

Date of Decision: September 11, 2009

1.

C.R. No. 443 of 2008

Food Corporation of India

…..Petitioner

Vs.

M/s J.V. Rice Mills and others

…..Respondents

2.

C.R. No. 444 of 2008

Food Corporation of India

…..Petitioner

Vs.

M/s J.V. Rice Mills and others

…..Respondents

CORAM:

HON’BLE MR. JUSTICE M.M.S. BEDI.

-.-

Present:-

Mr. K.K. Gupta, Advocate

for the petitioners.

Mr.Amit Singla, Advocate

for the respondents.

-.-

C.R. No. 443 of 2008 [2]

M.M.S. BEDI, J. (ORAL)

This order will dispose of two Civil Revision petitions bearing

Nos. 443 and 444 of 2008, as common question of law and facts arise in the

same.

The petitioner- Food Corporation of India has approached the

High Court by way of this revision petition under Article 227 of the

Constitution of India for setting aside of the only observation by the

Arbitrator that as District Manager, Hisar was not authorized to file the

claim petition though the petitioner is entitled to recover Rs.167875/- from

the respondent-miller besides a sum of Rs.12805/- as price of the rice less

delivered by the miller to the petitioner.

The petitioner Corporation had filed the claim against M/s

J.V.Rice Mills Tohana. The Indian Council of Arbitration (ICA) had

appointed Justice R.N. Mittal, Retd., as Arbitrator. The respondent Miler

contested the claim of the petitioner, inter-alia on the ground that it had not

been filed by duly a authorized person. Besides this a counter-claim for

recovery of Rs.187275/- was filed by the miller against the petitioner

Corporation being the milling charges, stitching charges and security. The

Arbitrator vide award dated February 14, 2001 framed total 12 questions for

determination. Though the claim of the petitioner Corporation for recovery

of Rs.167875/- was allowed but while deciding question No.2, it was held

that the Corporation could not claim the said amount as the District

manager, Hissar, who had filed the claim petition was not authorized to file

the claim as it was only Senior Regional Manager who had been given

C.R. No. 443 of 2008 [3]

powers to file claims before the Arbitrator. Simultaneously the counter-

claim of the respondent miller was allowed holding that miller was entitled

to recovery Rs.133910/- besides a sum of Rs.40000/- deposited as security.

It appears that the respondent did not file any application under

Section 34 of the Arbitration and Conciliation Act, 1996, (hereinafter

referred to as ‘the Act’). The petitioner filed an application under Section

34 of the Act. Vide impugned order, the Additional District Judge

dismissed the application holding that the Senior Regional Manager/

Regional Manager was competent to make a reference to the Indian Council

of Arbitration of the dispute upto Rs.10 lacs and thereafter Zonal Manager

was competent to make reference to the Arbitrator and to contest the claim

before the Arbitrator as per circular Ex.P-5, dated August 11, 1994, letter

annexure P-6 dated February 19, 1998, Ex.P-4 dated February 7, 1998 and

Ex.P-3 notification dated June 10, 1980. The Additional District Judge,

Hissar, had, relying on Ex.P-5, circular dated August 11, 1994 has observed

that the Senior Regional Manager and Zonal Manager have been delegated

with powers to sanction reference to the arbitration and to contest the claims

before the Arbitrators through Indian Council of Arbitration. The said

power has been delegated to Regional/ Zonal Manager by Board of

Directors of the petitioner and that the said power cannot be re-delegated.

The re-delegation of power by Senior Regional Manager to Distri